Analyzing the Mission and Vision Statements
Discuss about the Insurance Australia Group Strategic Management.
The management is expected to analyse the external business environment in acquiring a proper plan that will improve the performance of the company. Insurance Australia Group is a company that has acquired an increased market share through development of appropriate strategies. Proper evaluation of the financial industry has assisted the company to develop a plan to deal with the competition in the market. The corporate strategies implemented by the management are aimed at acquiring a sustainable competitive edge in the insurance industry (Grant 2016). The focus on organizational culture and leadership style assist the business to achieve long-term profitability in the market. Insurance Australia Group implements a vision and mission that will guide the employees towards an accomplishment of the desired production levels. It is necessary to develop mission and vision statements that will enhance the profitability of the company towards the achievement of the desired production level in the market.
The strategy is used by the management to operate and control the production process towards the accomplishment of the desired production level. It is essential for the administration to have a proper understanding of the consumer needs in acquiring a sustainable performance level in the market. Insurance Australia Group strategy is aimed at providing unique insurance services to the consumers in the nation for the achievement of the intended sales volume and profit margin (Insurance Australia Group, 2018). The top management develops the strategy with the aim of dealing with the changes in the business environment for extreme performance in the industry. The company has been able to be in the insurance industry for a long time due to the implementation of proper past and present strategies.
The mission statement is used to provide an overview of the production goals of the company for a steady flow of business operations. Staffs are required to act according to the mission statement in achieving the short term and long term production objectives (Klettner, Clarke & Boersma 2014). The Insurance Australia Group has a mission of providing quality insurance services to the public for a smooth flow of life. The company is aimed at acquiring the confidence of the community through safety services. The company operates in Australia, New Zealand, and Asia with the employees requiring focusing on an increased performance of the company by offering safety services to the community (Insurance Australia Group, 2018). The sustainability reports are used in ensuring that the employees follow the set mission statement for the accomplishment of the desired production level. The mission statement of Insurance Australia Group is focused on confidence and safety to the community through insurance services.
Examining Organizational Culture and Core Competencies
The vision provides the intended long-term goal of the company through the continuous development of operation in the market. The Insurance Australia Group vision is to become a leading insurance provider in Australia and Asia. The ability to satisfy the needs of consumers is used by a company to acquire the desired long-term production level. Insurance Australia Group develops plans that will provide an increase in shareholder value which is a responsibility of the company. The focus on shareholders assists the company to accomplish the desired capital for business expansion (Schenkel et al. 2015). A vision statement that is focused on shareholders is used by the public companies to attract a large number of investors in the market. The vision statement is used as an inspiration to the employees towards the attainment of the targeted production targets.
The core competencies are used by a company to make it appear unique in the targeted market. The uniqueness of production is essential in achieving an increased market share through high customer satisfaction. Insurance Australia Group code of conduct includes fairness, respect, communication, relationship and confidentiality (Insurance Australia Group, 2018). The emphasis on the community helps the business to develop products that are widely accepted in the market. The fair treatment of the employees and consumers assists the company to acquire a beneficial reputation that will maximize production. The focus on reputation in the targeted market helps the business to retain and acquire consumers (Han & Hyun 2015). Insurance Australia Group production processes are aimed at following the set regulations in the nation for proper flow in the market. The compliance to law assists in dealing with the external business environment for a steady flow of business production processes.
The strategies of the company are focused on customer service improvement for the accomplishment of the desired production level. The updating of the customer management systems has provided the company with a proper platform to increase the customer base in the insurance industry (Insurance Australia Group, 2018). It is necessary for a company to focus on quality production towards a sustainable performance in the market. A company needs the evaluation of consumer inquiries and complaints in developing products that will maximize profits. The financial products are supposed to evaluate the consumer needs in the market for a steady flow of the business performance.
The company current strategies are focused on technological innovations to assists in dealing with the changes in the financial market. It is essential for a company to develop a sustainable performance in the market through differentiated strategy. The differentiated strategy is archived by using advanced technology in the production process for unique services to the consumers. Insurance Australia Group is a public company requiring focusing on sharing of financial information to the community (Insurance Australia Group, 2018). The financial reporting is used by the company to enhance the perception of the public based on the performance of the company. Insurance Australia Group has been able to acquire a continuous increase in revenue and net profit which is necessary for raising the confidence of the community.
Focusing on Customer Service Improvement and Technological Innovation
The company has been criticized for refusal of claim payment and poor investment decisions. It is crucial for a company to focus on the stakeholders' needs reduce conflict of interests in the company. The criticism of the company is mainly due to the poor management plan that is implemented by the company to focus on the changing external business environment. The claim payment issues negatively impact the performance of the company due to the poor rating by the consumers. It is necessary for a company to focus on developing policies that are widely understood by the consumers to reduce issues while paying claims. The company was taken to court for refusing to pay claims after the house was infested with mold and the clients had NRMA home policy (Collier, 2013). The home policy is required to protect clients from loss incurred in the home due to natural emergencies. It was necessary for Insurance Australia Group to consider paying the claim as the mold were due to the heavy storms experienced in the nation at the time. The second issue is unprofitable businesses in the Southwest part of Asia which is making the company reduce the financial performance of the parent company in Australia (Chatterjee & Daga, 2018). It is necessary for a company to focus on profitable markets with the aim of acquiring a high-profit margin and value addition to the shareholders.
The issues have reduced the reputation in the market with potential consumers choosing the competing insurance company. The primary aim of insurance is to reduce the financial burden of an individual after acquiring the policy. An insurance company that has a high level of claim payment assists in obtaining a sustainable performance in the financial market. Insurance Australia Group is required to focus on fast claim payment towards the accomplishment of the short term and long term goals of production. The consumers are important stakeholders of the company which require being provided with quality services and products for sustainable performance of the company in the market (Agnihotri et al. 2016). Stakeholder management is necessary for decision-making process for a proper flow of business operations in the industry. According to Collier (2013), the 277,000 spores of mold in cubic meter compared to the reasonable level of 1000 spores per cubic meter. The repair and rebuilding process Insurance Australia Group was unable to deal with the issue in the market which led to the dissatisfaction of the client. The investment with a low return in Southeast Asia made the stakeholders to lose confidence in the amendment of the company. The company experienced an underwriting loss of A$ 6 million in the first half of 2018 compared to A$9 million in the second half of 2017 (Chatterjee & Daga, 2018). An organization is expected to focus on developing plans for dealing with the issues in the market through prior strategic management. The investment decisions implemented should be analysed to reduce the share value of the company which negatively impacts the shareholders.
Challenges and How They Are Addressing Them
The company developed plans to deal with the issues for a proper flow of the company in the insurance industry. Insurance Australia Group is highly dependent on the consumer and shareholders for the accomplishment of the desired production level. Insurance Australia Group developed a plan of rebuilding and repairs of the home of the client whose home was infested by mold (Collier, 2013). The repair was closely inspected towards the achievement of satisfaction to the consumers. The ability to accompany to deliver services to a company determines the customer loyalty in the market. The customer loyalty in the insurance industry is achieved through payment of claims considering the policy purchased from the company. The management focused on developing an organizational culture that is consumer oriented to reduce the complaints in the market (Alvesson & Sveningsson 2015). The organizational culture is needed in attaining the desired production level of the company through the enhanced cooperation of employees. In dealing with investments issues, the management is required to analyse the market to identify the profitable countries effectively. In dealing with the losses in the Southern Asia nations the company intended to sell the business at $ 500 million (Chatterjee & Daga, 2018). The company will be able to focus on profitable markets in Australia, New Zealand and part of Asia.
The PESTEL analysis is used to evaluate the external business environment by focusing on political, economic, social, technological, environmental and legal factors. Insurance Australia Group is required to assess the external business factors in Australia for sustainable performance in the market.
The political status in Australia is suitable for businesses due to the stability and deregulation of operations. Australia is ranked number thirteen by the Transparency International through its efforts to handle corruption (Transparency.org, 2018). The reduction of corruption levels in the country assists business to accomplish the desired production level in the market.
Australia has been experienced a continuous growth of the economy which is necessary for doing businesses. It is vital for the management to focus on a nation that has a stable economy to acquire the desired production level in the market. According to Janda (2017), there was a 3% increase in the economy in 2017 compared to the previous year due to the enhanced industrialization in the nation.
Australia is a multicultural nation where there are people from different ethical background and English is the widely used language in the country. According to Nelson (2015), an organization is expected to have an insight of the customs and beliefs of the community for increased performance in the market.
The technology use assists a business in developing plans that will enhance effectiveness in production. The technology infrastructures implemented in Australia are focused on acquiring a stable flow of the community through economic growth (Atse.org.au, 2018). Technology engineering department of Australia is used to discover the advanced technology that will enhance social and economic performance.
The government has developed conservation measures that should be used by the individuals and businesses in the nation. The Environmental Sustainability Policy is used by the government to regulate the waste and carbon dioxide emission in the country (Humanservices.gov.au, 2018). It is necessary to comply with the laws for a proper environment in the nation by handling the issue of climate change.
The regulations in the nations are focused on increasing local and foreign investment in the country. The Anti-Discrimination laws are used to provide equal opportunities to the community seeking employment (Australian Law Reform Commission, 2018). Businesses are required to focus on the set regulations towards a sustainable flow of the national activities.
The Porter’s five force analysis is a technique used by an organization to acquire the desired production level in the market. It is necessary for the management to understand the five forces which include competitive rivalry, buyer power, supplier power, threat to entry and substitute threat (Dobbs 2014). The competitive rivalry requires Insurance Australia Group to have an insight into the number of the insurance companies in the targeted market. The buyer power involves the number of consumers that the company depends on to achieve the set production objectives (Van Alstyne, Parker & Choudary 2016). It is essential for a company to have a large customer base towards accomplishment to the desired profit margin. Supplier power considers the number of suppliers in the market which determines the cost of raw materials and other production factors. Threats of entry are the focus on the regulations implemented by the government to restrict or encourage businesses from a specific sector (Eskandari et al. 2015). In Australia, there are no threats of entry leading to high competition in the insurance industry. The evaluation of substitute products assists a company to develop a strategy that will enhance competitiveness in the market.
The business strategy implemented by a business influences the long-term performance of the company. It is necessary for the top management to consider the dynamic external business environment in developing a proper strategy that will control business production. PESTEL analysis and Porter's five force analysis assist in developing a successful strategy in the market. Insurance Australia Group strategy is focused on acquiring a sustainable competitive advantage in Australia, New Zealand, and Asian market. The mission, vision, and code of conduct provide the staff with a guideline to follow for quality service delivery to the consumers. Insurance Australia Group management focuses on dealing with issues in tea market to have a decent reputation in the market. The stakeholders' interests are considered in the decision-making process to maximize profitability in the insurance industry.
Agnihotri, R., Dingus, R., Hu, M.Y. and Krush, M.T., 2016. Social media: Influencing customer satisfaction in B2B sales. Industrial Marketing Management, 53, pp.172-180.
Alvesson, M. and Sveningsson, S., 2015. Changing organizational culture: Cultural change work in progress. Routledge.
Atse.org.au. (2018). Infrastructure | Australian Academy of Technology and Engineering (ATSE). [online] Available at: https://www.atse.org.au/atse/subjects/infrastructure/content/subject/infrastructure.aspx [Accessed 16 May 2018].
Australian Law Reform Commission., 2018. Australian anti-discrimination law framework. [online] Alrc.gov.au. Available at: https://www.alrc.gov.au/publications/9-anti-discrimination-law/australian-anti-discrimination-law-framework [Accessed 16 May 2018].
Chatterjee, S. and Daga, A., 2018. Insurance Australia Group Plans to Sell Troubled SE Asian Businesses. [online] Insurance Journal. Available at: https://www.insurancejournal.com/news/international/2018/04/20/486911.htm [Accessed 16 May 2018].
Collier, K., 2013. Couple in toxic mold fight. [online] Heraldsun.com.au. Available at: https://www.heraldsun.com.au/news/victoria/couple-fights-insurer-insurance-australia-group-over-mould-infestation-in-home/news-story/576858c0f3c6aa0b4b5628eb3b2c84e2 [Accessed 16 May 2018].
Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry analysis templates. Competitiveness Review, 24(1), pp.32-45.
Eskandari, M.J., Miri, M., Gholami, S., Reza, H. and Nia, S., 2015. Factors Affecting The Competitiveness of The Food Industry by Using Porter's Five Forces Model Case Study in Hamadan Province, Iran. Journal of Asian Scientific Research, 5(4), pp.185-197.
Grant, R.M., 2016. Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
Han, H. and Hyun, S.S., 2015. Customer retention in the medical tourism industry: Impact of quality, satisfaction, trust, and price reasonableness. Tourism Management, 46, pp.20-29.
Humanservices.gov.au. 2018. Environmental Sustainability Policy - Australian Government Department of Human Services. [online] Available at: https://www.humanservices.gov.au/organisations/about-us/publications-and-resources/environmental-sustainability-policy [Accessed 16 May 2018].
Insurance Australia Group., 2018. IAG Limited. [online] Iag.com.au. Available at: https://www.iag.com.au/ [Accessed 16 May 2018].
Janda., 2017. The economy improves but weak consumers disappoint the optimists. [online] ABC News. Available at: https://www.abc.net.au/news/2017-12-06/economic-growth-gdp-figures-september-quarter/9231122 [Accessed 16 May 2018].
Klettner, A., Clarke, T. and Boersma, M., 2014. The governance of corporate sustainability: Empirical insights into the development, leadership and implementation of responsible business strategy. Journal of Business Ethics, 122(1), pp.145-165.
Nelson, R.R., 2015. The rate and direction of inventive activity: Economic and social factors. Princeton University Press.
Schenkel, M., Krikke, H., Caniëls, M.C. and van der Laan, E., 2015. Creating integral value for stakeholders in closed loop supply chains. Journal of Purchasing and Supply Management, 21(3), pp.155-166.
Transparency.org. 2018. Transparency International - Australia. [online] Available at: https://www.transparency.org/country/AUS [Accessed 16 May 2018].
Van Alstyne, M.W., Parker, G.G. and Choudary, S.P., 2016. Pipelines, platforms, and the new rules of strategy. Harvard Business Review, 94(4), pp.54-62.
To export a reference to this article please select a referencing stye below:
My Assignment Help. (2019). Essay: IAG. Retrieved from https://myassignmenthelp.com/free-samples/insurance-australia-group-management.
"Essay: IAG." My Assignment Help, 2019, https://myassignmenthelp.com/free-samples/insurance-australia-group-management.
My Assignment Help (2019) Essay: IAG [Online]. Available from: https://myassignmenthelp.com/free-samples/insurance-australia-group-management
[Accessed 02 December 2023].
My Assignment Help. 'Essay: IAG' (My Assignment Help, 2019) <https://myassignmenthelp.com/free-samples/insurance-australia-group-management> accessed 02 December 2023.
My Assignment Help. Essay: IAG [Internet]. My Assignment Help. 2019 [cited 02 December 2023]. Available from: https://myassignmenthelp.com/free-samples/insurance-australia-group-management.